From Staff Reports

China Shenhua Energy Co., China’s largest coal producer, plans to raise 66.6 billion Yuan ($8.9 billion), in the biggest share sale in China in 2007.

The initial public offering will sell about 1.8 billion shares on the Shanghai market for 34.99 Yuan to 36.99 Yuan a piece, the company said in a statement. The date for the IPO hasn’t been announced, though the money will finance expansion.

News of the sale sent the company’s shares on the Hong Kong market up 6.6% to a record HK $46.15 by close. And more gains are expected to follow when the Shanghai IPO takes place. Bloomberg News reports that the last six companies to hold mainland IPOs have seen their shares jump an average of 250% on their first day of trading.

That’s likely to be the case for PetroChina, the country’s largest oil and gas producer. China’s securities regulator announced yesterday (Monday) that it gave PetroChina the green light for an estimated $5 billion IPO on the Shanghai exchange. Proceeds from the IPO will expand refineries and boost output at oil fields.

Shares of PetroChina (PTR) on New York Stock Exchange leaped a cool 8.31% (or 13.9 points) on Monday following the news. In the past month, they had gained 25.26% (or 36.52 points).

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Expect increased trading volume and market volatility today (Friday) as index futures, market index options, stock options, and stock futures all expire on the same day.  While index futures and options typically share simultaneous expirations on the third Friday of every month, quadruple witching days usually only come about on the third Friday of every March, June, September, and December.

Many investors scramble to unwind their positions in their contracts before they expire, which includes repurchasing contracts and closing out other positions used to hedge against those contracts. So, quadruple witching days are usually marked by periods of volatility in stock and derivative prices, and increased trading volumes.

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Honeywell International Inc. (HON) announced yesterday (Wednesday) that it won a $16 billion contract to provide mechanical systems for Airbus SAS’s long-range, wide-body A350 aircraft.

The 20-to 25-year contract will give New Jersey-based Honeywell, the world’s biggest maker of auxiliary power generation units, clearance to design and build systems that supply pneumatic and electric power for the aircraft. Honeywell will also provide environmental-control systems for cabin heating and cooling and cabin pressurization.

The A350-XWB won’t take flight until about 2013, five years after Boeing’s 787 is slated for its first delivery.

Bloomberg News reports that Honeywell’s aerospace unit made up $11.1 billion of the parent company’s $31.4 billion in revenue last year. Its 2007 forecast calls for $12.1 billion in aerospace sales this year.

News of the contract sent Honeywell’s shares up 98 cents each, or 1.71%, to close at $58.26 yesterday.

Honeywell will issue its third-quarter earnings report before the start of trading on Friday, Oct. 19. The company will also host a conference call with investors, starting at 8 a.m.

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If you’re looking for a safe haven in today’s volatile U.S. stock market, Piyush Sharma, a senior equity research analyst for Longbow Research, has suggested the commercial printing industry might be a good place to seek shelter.

Markets have been extremely sensitive recently as credit problems continue to escalate. The Dow Jones Industrial Average closed at 12,845.78 yesterday, down 15.69 points, or 0.12%. But the real story was the wild ride it gave investors. The index plunged 100 points in the first four minutes of trading, and was down 343 points, before rallying to almost close the day at a breakeven point.

Even so, the Dow is down 1,150 points, or 8.2%, from its high above 14,000.

With such volatility investors will no doubt be looking for a few fortified safe havens and one might be commercial printing. As Sharma pointed out in a client note on Thursday, commercial printing companies outperformed the broader market during last two recessions. His top picks in the industry include R.R. Donnelly & Sons Co. (NYSE: RRD), and American Reprographics Co. (NYSE: ARP) – both of which he says boast stability and value. 

Over the course of his career, Sharma covered the U.S. auto parts sector as an equity analyst for Sanford C. Bernstein in New York. He was also the economist at Bombay Stock Exchange, and worked with Citigroup GCB in credit analytics. He graduated with an MBA from the Kenan-Flagler Business School at UNC Chapel Hill and holds masters and undergraduate degrees in accounting and finance from MNNIT and the University of Allahabad.

Longbow Research is an independent institutional equity research firm based in Cleveland, Ohio. It provides fundamental research to more than 200 institutional clients in the United States and Canada.